In a surprising turn of events, Kiran Gems, a prominent name in the jewelry industry, has decided to close its operations in Surat and relocate its business base to Mumbai. This unexpected move comes as a setback to Surat’s aspirations to become India’s diamond capital, especially in the aftermath of the inauguration of the ambitious Surat Diamond Bourse (SDB) project by Prime Minister Narendra Modi just a month ago.
Despite recently showcasing its trading hub at the SDB in a promotional video, Kiran Gems’s decision to shift raises questions about the potential success of Surat as a diamond business hub. The move is seen as a blow to the city’s efforts to establish itself prominently in the diamond industry.
Kiran Gems Private Limited, with a registered capital of Rs 71 crore and a paid-up capital of Rs 20.98 crore, reported substantial revenue exceeding Rs 500 crore in the fiscal year 2021. The sudden relocation to Mumbai highlights concerns about increased costs, travel time, and inflation, possibly influencing the decision.
Surat’s diamond merchants had invested a significant amount, approximately Rs 3,400 crores, to develop the world-class diamond business hub at SDB, covering an expansive area of two lakh square feet with 2,500 offices.
This setback has sparked discussions within the industry about the factors influencing businesses’ preference for Mumbai over Surat, with Mumbai’s comprehensive amenities and facilities emerging as a primary consideration.
Although Vallabhbhai Lakhani, the founder of Kiran Gems, had initially chosen to shift the company to Surat, the recent move to Mumbai indicates a reevaluation of operational considerations. Despite the setback, the SDB committee members have expressed their commitment to maintaining operational continuity in both Mumbai and Surat until the SDB is fully operational.
This incident underscores the challenges in establishing Surat as a prominent diamond trading destination, with businesses weighing factors such as infrastructure, convenience, and established networks in their strategic decisions.
